[Congressional Record Volume 142, Number 24 (Tuesday, February 27, 1996)]
[Senate]
[Pages S1366-S1368]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KYL (for himself, Mr. Coverdell, Mr. Craig, Mr. Faircloth, 
        Mr. Grams, Mr. Inhofe, Mr. Kempthorne, Mr. Lott, Mr. McCain, 
        Mr. Pressler, Mr. Santorum, Mr. Shelby, Mr. Smith, Mr. Thomas, 
        and Mr. Thompson):
  S.J. Res. 49. A joint resolution proposing an amendment to the 
Constitution of the United States to require two-thirds majorities for 
bills increasing taxes; to the Committee on the Judiciary.


                TAX LIMITATION CONSTITUTIONAL AMENDMENT

 Mr. KYL. Mr. President, during the next 8 weeks, millions of 
Americans will file their income tax returns. According to estimates by 
the Internal Revenue Service, individuals will have spent about 1.7 
billion hours on tax-related paperwork by the time their returns are 
completed. Businesses will spend another 3.4 billion hours. The Tax 
Foundation estimates that the cost of compliance will approach $200 
billion.
  Mr. President, if that is not evidence that our Tax Code is one of 
the most inefficient and wasteful ever created, I do not know what is. 
Money and effort that could have been put to productive use solving 
problems in our communities, putting Americans to work, putting food on 
the table, or investing in the Nation's future are instead devoted to 
convoluted paperwork.
  It is no wonder that the American people are frustrated and angry, 
and that they are demanding radical change in the way their Government 
taxes and spends. It is no wonder that tax reform has become one of the 
major issues of this year's Presidential campaign.
  Mr. President, today I am introducing a resolution with more than a 
dozen of my colleagues that represents the first concrete step toward 
comprehensive tax reform. The resolution, which we call the tax 
limitation amendment, would establish a constitutional requirement for 
a two-thirds majority vote in each House of Congress for the approval 
of tax-rate increases. 

[[Page S1367]]

  A companion resolution, House Joint Resolution 159, was introduced in 
the House of Representatives on February 1 by Congressman Joe Barton of 
Texas and 155 other House Members.
  The two-thirds supermajority that we have proposed was among the 
recommendations of the National Commission on Economic Growth and Tax 
Reform, appointed by Majority Leader Bob Dole and Speaker Gingrich. The 
Commission, chaired by former HUD Secretary Jack Kemp, advocated a 
supermajority requirement in its recent report on how to achieve a 
simpler, single-rate tax to replace the existing maze of tax rates, 
deductions, exemptions, and credits that makes up the Federal income 
tax as we know it today.
  Here are the words of the Commission:

       The roller-coaster ride of tax policy in the past few 
     decades has fed citizens' cynicism about the possibility of 
     real, long-term reform, while fueling frustration with 
     Washington. The initial optimism inspired by the low rates of 
     the 1986 Tax Reform Act soured into disillusionment and anger 
     when taxes subsequently were hiked two times in less than 
     seven years. The commission believes that a two-thirds super-
     majority vote of Congress will earn Americans' confidence in 
     the longevity, predictability, and stability of any new tax 
     system.

  Mr. President, in the 10 years since the last attempt at 
comprehensive tax reform, Congress and the President have made some 
4,000 amendments to the Tax Code. Four thousand amendments. That means 
that taxpayers have never been able to plan for the future with any 
certainty about the tax consequences of the decisions they make. They 
are left wondering whether saving money for a child's education today 
will result in an additional tax burden tomorrow. They can never be 
sure that if they make an investment, the capital gains tax will not be 
increased when they are ready to sell. Rules are changed in the middle 
of the game, and in some cases, the rules have been changed even after 
the game is over. President Clinton's tax increase in 1993 
retroactively raised taxes on many Americans, including some who had 
died.
  The volatility of the Tax Code is not new. You will recall that the 
income tax was established in 1913 with a top rate of 7 percent; fewer 
than 2 percent of American families were even required to file a tax 
return. Just 3 years later, on the eve of the First World War, the top 
rate soared to 67 percent. By the Second World War, the top rate had 
risen again--to 94 percent--and it remained in that range through the 
1950's. Of course, by that time, the tax had been expanded to cover 
almost every working American.
  Ten years ago, President Reagan succeeded in reducing the number of 
tax rates to just two--15 percent and 28 percent. But it was not long 
before additional rates were established, and taxes were raised again 
under the Clinton administration.
  The tax limitation amendment would put an end to the roller coaster 
ride of tax policy that has so bedeviled hard-working Americans. And it 
guarantees more than stability and predictability. It will also ensure 
that taxes cannot be raised--whether we ultimately adopt a single-rate 
tax as the Kemp commission has proposed, a national sales tax as 
Senator Lugar has proposed, or some alternative--unless there is 
sufficient consensus and strong bipartisan support in Congress and 
around the country.

  Mr. President, the last tax increase to have cleared the Congress was 
proposed by President Clinton in 1993, and you will remember that it 
was the largest tax increase in history.
  I was serving in the House of Representatives at the time. It seemed 
to me that most Americans strongly opposed the plan. The calls, 
letters, and faxes from my constituents in Arizona ran about 10 to 1 in 
opposition to the President's tax plan. There was a lot of opposition 
in Congress, too. The opposition was bipartisan--Republicans and 
Democrats. Unfortunately, the President was able to hold onto enough 
members of his own party in the House to pass it there, but only with 
partisan Democrat support.
  The story was different in the Senate. Not more than 50 Senators were 
willing to support the largest tax increase in history. A measure would 
normally fail on a tie vote--in this case, 50 to 50. The reason the tax 
increase passed was that the Vice President, as in the case of any tie 
in the Senate, had the right to cast the deciding vote. That is his 
right under the Constitution. The tax bill was not passed improperly, 
but it is notable that the largest tax increase in history managed to 
become law without the support of a majority of the people's elected 
Senators. To me, that is a travesty.
  The tax increase of 1990--the next largest in history after the 1993 
law--passed with a majority of 54 percent in the Senate and 53 percent 
in the House. That was only slightly better. Yet given the size of the 
increase and the burden it placed on the American economy, it seems to 
me that there should have been greater consensus to pass it, too. 
Taxing away people's hard-earned income is an extraordinary event--or 
at least it should be. However, in Washington, it has become routine.
  A two-thirds majority vote is, as George Will put it, ``one way of 
building into democratic decisionmaking a measurement of intensity of 
feeling as well as mere numbers.'' He noted that supermajority 
requirements are a device for assigning special importance to certain 
matters, and maybe taxation should be one of them.
  The last two tax increases were passed without much intensity of 
feeling at all--without any real consensus that a majority of Americans 
supported them.
  Some people might say, fine, there should be consensus, but ours is a 
government of majority rule. I would respond by noting that 
supermajority requirements are not new to the Constitution. Two-thirds 
votes are required for the approval of treaties, for conviction in an 
impeachment proceeding, for expulsion of a member from either body, for 
proposed constitutional amendments, and for certain other actions.
  If it is appropriate to require a two-thirds vote to ratify a compact 
with a foreign country, it seems to me that it is certainly appropriate 
to require a two-thirds vote to approve a compact with our own citizens 
that requires them to turn over a greater share of what is theirs to 
the Government.
  I want to quote briefly from one of our Founding Fathers, James 
Madison. He was, of course, a strong supporter of majority rule. Yet he 
argued eloquently that the greatest threat to liberty in a republic 
would come from unrestrained majority rule. This is what he said in 
``Federalist No. 51'':

       It is of great importance in a republic not only to guard 
     the society against the oppression of its rulers, but to 
     guard one part of the society against the injustice of the 
     other part.

  If Madison were here today, I believe he would conclude, first of 
all, that the Tax Code is oppressive to our people. Americans never 
paid an income tax until early in this century. By 1948, the average 
American family paid only about 3 percent of its income to the Federal 
Government. The average family now sends about 25 percent of its income 
to Washington. Add State and local taxes to the mix, and the burden 
approaches 40 percent. That is oppression.
  Note that Madison also warned, in the quotation I just read, about 
pitting one part of America against the rest of the country. That is 
happening here as well. Certain segments of our society--some call them 
special interests--have learned in recent years how to feed at the 
public trough while spreading the cost among all taxpayers. This cost-
shifting has left the country with a debt that is $4.9 trillion and 
growing. Our Founding Fathers could never have imagined such 
profligacy, or I believe they would have imposed constitutional limits 
on taxing and spending at the very start of the Republic.
  If you are interested in lobbying reform, I will tell you this: a 
two-thirds requirement for tax changes would probably do more to 
curtail lobbying for special breaks than just about anything else we 
could do. Since every tax break must be offset with a tax increase on 
someone else to ensure revenue neutrality--and the second part of the 
equation, remember, would be out of reach without massive political 
support--the two-thirds requirement would make it virtually impossible 
for special interests to gain special advantage in the Tax Code.
  Confidence. Stability. Predictability. These are things that a two-
thirds supermajority would bring to the Tax 

[[Page S1368]]
Code. Combine this with comprehensive tax reform that is aimed at 
simplifying the law and minimizing people's tax burden, and we could 
see an explosion of economic growth and opportunity unmatched in this 
country for many years.
  Mr. President, I invite my colleagues to join me in supporting the 
tax limitation amendment.
  Mr. President, I ask unanimous consent that the text of the joint 
resolution be printed in the Record.
  There being no objection, the joint resolution was ordered to be 
printed in the Record, as follows:

                              S.J. Res. 49

       Resolved by the Senate and House of Representatives of the 
     United States of America in Congress assembled (two-thirds of 
     each House concurring therein), That the following article is 
     proposed as an amendment to the Constitution of the United 
     States, which shall be valid to all intents and purposes as 
     part of the Constitution when ratified by the legislatures of 
     three-fourths of the several States within seven years after 
     the date of its submission by the Congress:

                              ``Article--

       ``Section 1. Any bill to levy a new tax or increase the 
     rate or base of any tax may pass only by a two-thirds 
     majority of the whole number of each House of Congress.
       ``Section 2. The Congress may waive section 1 when a 
     declaration of war is in effect. The Congress may also waive 
     section 1 when the United States is engaged in military 
     conflict which causes an imminent and serious threat to 
     national security and is so declared by a joint resolution, 
     adopted by a majority of the whole number of each House, 
     which becomes law. Any provision of law which would, standing 
     alone, be subject to section 1 but for this section and which 
     becomes law pursuant to such a waiver shall be effective for 
     not longer than 2 years.
       ``Section 3. All votes taken by the House of 
     Representatives or the Senate under this article shall be 
     determined by yeas and nays and the names of persons voting 
     for and against shall be entered on the Journal of each House 
     respectively.''.

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